The specialist lender said the changes would reflect the “realities of corporate leasing arrangements”.
Quantum Mortgages will now accept the higher of passing rent, lease value or assured shorthold tenancy (AST) value for affordability assessments on corporate leases.
This will apply where the tenancy term is a minimum of five years and remains valid over the initial fixed rate period. Quantum Mortgages said this would give more clarity and opportunity to landlords with long-term commercial tenants, such as housing associations or supported living providers.
Quantum Mortgages will also accept open market value investment valuations for house in multiple occupation (HMO) and multi-unit freehold block (MUFB) properties, as long as the valuation does not exceed 15% above the 180-day vacant possession value.
The lender said this would support the changing needs of professional landlords and would be market reflective, allowing for greater flexibility around lending decisions for complex properties.
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The lender has also launched a semi-commercial product under its QML Pro range, for more specialist properties.
The QML Pro mixed use product is priced 50 basis points lower than its standard range, and allows up to 50% commercial use.
All rental income, including residential and commercial, can be considered for affordability.
Harsha Dahyea, chief commercial officer at Quantum Mortgages, said: “These changes reflect our ongoing mission to evolve with the needs of the market.
“By listening to broker feedback and understanding the challenges faced by specialist landlords, we’re proud to deliver criteria that offer greater flexibility, transparency, and opportunity.”
Earlier this year, the firm completed its second securitisation.
